How to Make Money Flipping Cars

Reselling 101

By RC Staff

31 May 2023

While the used car market isn’t quite as hot as it was this time last year, prices are still high. Savvy resellers know there is plenty of money to be made flipping cars. And don’t worry, most of the time you won’t even need to make any repairs. Finding the right cars to resell typically means doing no more work than giving it a wash and listing it for sale. We’ll leave the engine rebuilds to the pros. Want to learn more? Let’s look at the basics of flipping cars.

Is it profitable to flip cars?

You may have heard before that “cars are a terrible investment”. For a vehicle that you intend to drive, that’s generally true. Most new cars depreciate extremely fast, typically losing a sizable fraction of their value the second they leave the dealer’s lot.

Additionally, with such a wide pool of vehicles out there, it’s somewhat uncommon for a particular model to increase in value over time. Most will tend to slowly creep towards zero, especially if they’re being actively driven.

But it’s entirely possible to profit from flipping cars. As is the case with most other items to resell, the trick is in finding them for sale at low prices and selling them at high prices. Yeah, yeah, that’s obvious, but the truth is things really are that simple. We’ll be giving our thoughts on the types of cars to seek out, and the kinds to avoid to maximize your profit.

The focus of this article will primarily be on cars that require no or minimal repair work. This is intended for people interested in making a quick profit flipping cars, not mechanics. Of course, if you are mechanically inclined, reselling cars can be great opportunity for you to both make money and hone your skills.

Choosing cars to resell

For the purposes of this article, we’re going to be breaking down vehicles into three categories. Obviously there are all kinds of vehicles out there, but these are what you should be focusing on as a reseller.

The categories we’ll be looking at are commuter cars, classic cars, and new cars. You’ll find that reselling a car requires an investment of both time and money; generally the less money you want to put in the more time will be required, and vice versa.

Of these three types, commuter cars will generally be the most common, and the cheapest cars to flip. Your initial investment will typically be somewhere between $3,000 and $10,000 depending on the car. Classic cars are by far the riskiest category here, as they tend to be competitive and sellers are typically well aware of the value of their vehicle. Reselling new cars is possible in certain cases as well. These will require the highest upfront investment, but require very little work to flip.

Best commuter cars to flip

By commuter cars, we mean the unremarkable vehicles people use to get to work. Corollas and Camrys, but not Corvettes. Buyers of these vehicles want something reliable, well-maintained, and relatively low-mileage.

It’s important that the basic features are functional in these types of vehicles. The wiper blades should be changed and functional, the AC should blow cold, and the heater actually heats. These are typically very simple fixes, so there’s no reason to put off buyers by not fixing them.

Here are some examples of commuter cars that resell:

• Family cars. Think sedans and crossovers. You’ll generally want to look for Japanese examples, like Toyota Camrys or Honda CR-Vs from 2000-2015. These cars are well-made and highly functional. While mileage should always be a concern, a well-maintained vehicle from a sold manufacturer can still have plenty of life left in it, even years after leaving the factory.
• Light trucks. There’s a reason the circa-2000s Ford Ranger is such a legendary vehicle. These trucks are typically extremely reliable and often in frequent demand. If you can find one for a good price, there’s easy profit in reselling one.
• Minivans. Not fashionable, sure, but minivans are always in demand. New and growing families find they quickly outstrip their existing cars, and will look to expand. Japanese models are typically best, but the Dodge Grand Caravan and Volkswagen Touareg are also reliable options.

Best classic cars to flip

Buying and reselling classic cars can be pretty dicey. The values of these cars are typically well-established, and both buyers and sellers tend to be knowledgeable about repairs and maintenance, reducing your edge.

That said, there are still ways to profit here. As a car flipper you should always keep your eyes out for any of the American classic cars like Ford Mustangs, Chevy Camaros and Corvettes, and the various MOPAR and Chrysler offerings.

With classics, the body is what matters. Cars with good paint and no rust are what you want to look for. Obviously, a running vehicle is ideal, but even a high-quality frame and chassis can be profitable to resell.

Instead of hunting for classic cars, consider looking for classic car parts to resell. Builders and collectors need steady supply of parts to restore vehicles, and will pay well for them. If you’re at a junkyard, look for pristine examples of interior and dashboard pieces, as well as gauges and electronics. Trim pieces and exterior parts are also good examples. Exterior car parts in good condition with no rust are very desirable.

Reselling new cars

Occasionally, there will be an opportunity to profit by reselling a brand-new car. This requires a variety of factors, namely limited supply. Since you’re buying from a dealer, there will have to be pretty serious demand to make up for the dealer markup. Uncommon, sure, but not unheard of.

Here are some examples of new cars that have recently resold for well over retail.

• GMC Hummer EV. We wrote an entire article on this beefy SUV. When GMC brought the electric Hummer to market, they did so in phases. The launch edition Hummer EV was extremely hyped and sold in limited numbers, leading to a sizable aftermarket. The MSRP was around $100,000, but resellers could flip them for around twice that.
• 2021 Toyota Land Cruiser Heritage Edition. This was the last V8 Land Cruiser to be sold in America. Predictably, the swan song for this off-road classic was very popular, and buyers were willing to pay tens of thousands over the MSRP for one.
• 2023 Dodge Demon. When the Dodge Demon hit the market back in 2018, it made waves for its sheer power. Only 3,300 were made at the time and it was believed that was the last we’d see of them. When it made a surprise return in 2023, the hype returned in full. Despite most dealers asking around $150,000 for one, resellers who picked up an allocation could flip it for $200,000+. Check out our article on the 2023 Dodge Demon here.

As you can see, flipping new cars requires some special factors to be at play. In the case of these three examples, the cars in question were produced by well-established brands, and sold in limited numbers. With the transition to electric vehicles, many classic models of cars are being phased out or fundamentally altered to accept the new powerplant. This causes the send-off model of the car to be extremely popular and resell.

Additionally, the cars also tend to be expensive. When reselling new cars, you can expect to put up a fairly sizable down payment, and also need to have a wealthy buyer willing to take it off your hands. Because of the costs involved, reselling new cars is risky outside of niche examples like those listed above.

What to look for when buying a car to flip

When it comes to flipping cars, you’ll mostly be looking at the same things you’d consider in a personal vehicle. A car’s maintenance history is absolutely critical; you don’t want to sink money into a beater. The more information the better, so make sure you ask the seller for relevant receipts and the service history.

Take a good look at the exterior of a car. Dings and dents are not a dealbreaker, but keep your eye out for rust. If you live in the northeast or anywhere with severe winters, get a good look under the car. Salt on roads can wreak serious havoc on a car’s underside.

Rust can completely ruin a flip for you. If the rust is affecting the frame or critical parts like the suspension, it’s best to just walk away.

Ask the seller not to warm up the car before you see it. It’s important to see how a vehicle starts cold to have a better understanding of its condition. Pay attention to the sound of the engine for knocking or clattering sounds, which are signs of a failing engine. Watch for smoke coming from the exhaust as well. Check where the vehicle has been parked for stains on the ground. These can be signs of an oil or other fluid leak.

You want to find a vehicle in good shape for a good price. Depending on your own level of skill and free time, you can make basic repairs like fixing dents and replacing trim pieces.

Craigslist and Facebook Marketplace will generally be your first stop to find cars to flip. Check your local area frequently for new listings, and contact sellers fast when something catches your eye. Also, keep your eye out for vehicles listed for sale offline, as these can be extremely lucrative opportunities under the right conditions.

Flipping cars isn’t always easy, but it can be very profitable. It just takes a little luck to find the right car, and you can turn a tidy profit from just one car. Above all, it’s important to be cautious and detail-oriented when it comes to buying cars to flip. Missing a defect or maintenance issue can end up ruining a flip and costing you money, so it’s better to walk away on a questionable deal.

Want to learn more about the best items to flip? Join RC Elite! No matter what you’re interested in, from shoes to cars, clothes to real estate, all of the best flips are posted in RC Elite. There’s always something new to learn, and new methods to make money flipping items. Make sure you’re subscribed to our newsletter as well. In addition to guides like these, we also cover new items to resell every day.